MALAYSIA’s economy is on a strong footing to attract quality investments, said International Trade and Industry Minister Tengku Zafrul Abdul Aziz. 

In an interview with CNBC this morning, he said that although challenges still remain due to global economic uncertainties, China’s move to reopen its borders next week bodes well for Malaysia, as China is the nation’s largest trading partner. 

“The move will help our exports and economy. Domestically, efforts focusing on environmental, social and corporate governance principles in key sectors, enhancing the ease of doing business, and moving up on the value chain in sectors that we are strong in will also help cushion the impact of global economic headwinds. 

“Malaysia is forecasting a 4% growth in 2023. Our (growth) numbers are looking good, inflation is at 4% and the unemployment rate is at 3.6%,” he said. 

Tengku Zafrul added that Malaysia is expected to register a gross domestic product (GDP) growth of 8% to 9% in 2022. 

For the first nine months of 2022, the nation’s economy expanded by 9.3%, he said, adding that the country registered a 14.2% gross domestic product growth in the third quarter of 2022 amid robust domestic and external demand as well as an improved labour market.

During the interview, Tengku Zafrul also noted several possible concerns that could affect global economic growth prospects, namely, monetary and fiscal tightening, global tensions such as the Ukraine-Russia war, which disrupted supply chains as well as exporters’ capacity in meeting market demands.

CPTPP to continue 

The minister said the unity government, led by Prime Minister Anwar Ibrahim, is very much committed to the nation’s participation in the Comprehensive and Progressive Agreement for Trans-Pacific Partnership, which came into effect on November 29 in Malaysia. 

Replying to a question on whether there would be a new re-evaluation of the 11-member trade deal, Tengku Zafrul said the prime minister himself had signed all the necessary administrative agreements to ensure exports and imports can continue under the ratified deal.

“There were obviously some issues that were raised by various groups and we have addressed that by taking a number of actions to mitigate some of the concerns, so we are very much committed to participating in it,” he said.

Ringgit to strengthen further

When asked if the worst is over for the ringgit, which depreciated by 6% in 2022, Tengku Zafrul said he is optimistic the local currency will continue to strengthen in 2023, given Malaysia’s growth forecast for the year. 

“I think the key point here is what is going to happen to the US dollar. From my point of view, I think the dollar has reached a comfortable level,” he added. – Bernama, January 5, 2023.